U.S. lags in business funding of academic research

The U.S. lags 13 other nations in the support businesses provide to academic researchers, according to a study compiled by Times Higher Education.

South Korea ranks No. 1 on the World Academic Summit Innovation Index. Businesses invest an average of $97,900 per scholar in that country for R&D work on their behalf. In the U.S., businesses are providing only $25,800 per academic researcher.

This report is the latest piece of bad news in "a long and troubling trend of faltering industry investment in university research in the United States," writes Stephen Ezell, senior analyst with the Information Technology and Innovation Foundation. From 2000 to 2008, business funding for U.S. university research fell by 7 percent as a share of gross domestic product, ITIF reported in 2011.

Weak business investment in academic R&D is bad for two reasons: First, it means we can't count on business to make up for the decline in government support for R&D. Second, as Ezell points out, "business funding of university research encourages essential links between commerce and academia, orienting research toward topics and ideas that are more likely to create new businesses, products and jobs."

Some of the countries ahead of the U.S. when it comes to industry support for academic R&D provide more generous tax credits for business R&D conducted at universities. ITIF recommends that Congress allow businesses to take a 20 percent credit for all collaborative research conducted at universities, national laboratories or between research consortia.

The federal government also could provide incentives for universities to work with businesses on research by allocating a share of federal R&D funding to universities based on their success at attracting industry R&D, Ezell suggests. The government also should fund commercialization accelerator grants and pilot programs for experimental approaches to technology transfer, he writes.

'We simply can’t take America’s leadership in global innovation for granted anymore," Ezell writes. "We must continue to invest and to introduce innovative public policies that support private-sector innovation if America is to maintain its status as the world’s most innovative nation."